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Executive digest: Malcolm Lowe-Lauri

Highlights

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Hospitals, community healthcare providers and payers must go beyond their borders to create partnerships, networks and alliances (PNAs) in order to achieve an integrated, cost-effective and high quality service environment. The specific model of collaboration is less important than ensuring the ability of institutions and their professionals to come together seamlessly. Such integration is not simple; it requires healthcare organizations to make purposeful, yet flexible, long-term decisions.

Factors driving coordination of care

The provision of healthcare is becoming more complex and specialized, making it difficult for institutions to match traditional structures to fit shifting patterns of demand. As a result, organizations around the world are looking to develop PNAs to coordinate care across different kinds of providers. Complementary to this is the drive for information. Information alliances allow participating organizations to obtain wider access to data so they can achieve new levels of insight into what they are doing, their patients and the populations they work with. These insights can be critical for formulating activities that enhance the entire system of care.

There are also strong legislative (e.g. Affordable Care Act in the US) and financial drivers making the case for PNAs. Many payers are spending more on non-hospital and even non-health services to deal with growing volumes of patients, while providers are swamped trying to deal with increased volumes with less money. Everyone needs a better solution. That is why these factors are driving convergence between acute care hospitals and primary and community providers — so that each can better manage their business processes, clinical pathways and their people more effectively. It is also why payer-provider alliances are becoming increasingly common. Successful PNA players have often extended into international efforts in research and education and sophisticated commercial partnerships with the life sciences sector.

Avoiding PNA pitfalls

When it comes to creating effective PNAs, the biggest dangers come from not thinking long-term. The best PNAs have evolved over time and with a shared vision. Hospitals that move too quickly often find there is little-to-no positive impact on their organizations because they did not conduct the right due diligence or they did not pay enough attention to governance or defining strategic outcomes. The message is, pick the right partners, create or join the right networks, or form the right alliances. Transition can also be a challenge if not planned for in advance. Organizations must understand the need to fully commit to an environment of shared sovereignty, to put their stake in the PNAs objectives. Without this buy-in, PNAs can devolve into focusing on issues within the network instead of on achieving strategic objectives.

Achieving benefits

When it comes to PNAs, there are a number of factors that can influence success. As a starting point, think strategically about what you are doing and how you are doing it. Be purposeful in your actions — flexible, but focused on the long-term. Successful PNAs often form out of organizations having an evolving but continuous strategy. A ‘chop and change’ approach rarely works. Leadership is also essential. Ask yourself, how active your leadership is with external partners and whether you are looking outside your organization as well as inside? The best leaders understand their position in the system and how their actions affect the broader group both positively and negatively. Even if you are hesitant about PNAs, do not let your uncertainty stop you from considering options. Even in cases where the operating environment has looked unfavorable to collaboration, we find examples of success. With planning and effort, success is possible. Most of all, do not be constrained by your organizational borders, and do not be distracted by the tyranny of the present.

Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.